In the public eye

Brokers are no longer just competing against two or three local rivals - those days are long gone. The need to create a profile and identity for a business has meant the emergence and growth of the public relations industry.

If a broker decides it wants to use PR, then how can it measure the success of a campaign, and should brokers be looking internally or externally for help?

Before examining the respective benefits of in-house and agency campaigns, it is worth taking a look at what PR can offer a firm. Many operating in smaller brokerages tend to believe that PR is not something in which they need to get involved. However, this is not necessarily the case.

In speaking to the media, a firm's name can be mentioned alongside some of the larger players in the market and a small broker can, for once, level the playing field between itself and its larger competitors.

Anne Staunton, founder of Peak Marketing and Communications, explains: "I think the smaller brokers can really benefit from using PR, as it gives them a level playing field on which to communicate. Providing the information they give to the media is of relevance, it is as important for them to have a viewpoint as to what is going on in the industry as it is for the larger broker. I would say that the smaller broker is more in touch with the needs of the market as, often, they have a closer relationship with clients due to their smaller customer base."

Not only does the use of PR help smaller firms contribute to industry debates and appear on the same stage as the larger players, but it is also less expensive than running an advertising campaign.

A competitive market

Staunton continues: "The market is hugely competitive now and brokers in particular have to compete with the direct writers who are throwing huge amounts of money at advertising and PR campaigns. To compete, brokers need to be able to differentiate themselves and educate the customer as to the actual benefits of coming to them, as the direct writers are all talking about cost.

"PR can assist them in differentiating and educating their target market in why they should come to them and it is a lot more cost-effective than taking the advertising route. It is also a lot more powerful, as it is seen as the media endorsing their message rather than being paid-for space."

For large brokers, the issues surrounding the use of PR are slightly different, but no less important. Sebastian St John Clarke is part of Aon's in-house press department and comments: "I think if we did not have an in-house press office we would suffer. Working with the media is one of our best communication routes in terms of communicating with our clients and our own staff. People read the press and having an in-house team drives that. We have a point of contact for people calling into the business from the media and without that I think our reputation would suffer."

For a company of Aon's size there is also the strong possibility that, without proper co-ordination, PR could give differing and confusing messages.

Clarke adds: "If a firm does not co-ordinate what it is saying to journalists, you end up with splintered messages and so the company looks unco-ordinated in what it is doing."

Co-ordinated communication

Co-ordination is key, not only when a PR campaign is up and running but also when it is being discussed and planned. Matthew Jervois, director at PR and marketing agency Spada, explains further: "Before a communications programme is undertaken, certain planning needs to be done to ensure both parties are working towards a specific goal. In essence, this involves a three-stage process: planning, research and evaluation. An audit needs to be undertaken showing the company where it is currently positioned. Objectives then have to be set so a firm knows where it wants to be, a strategy put in place to allow it to get there and then ongoing measurement to see if it is getting there."

Staunton agrees with this approach and adds: "Those that are being successful are not necessarily throwing huge amounts of money at it but are using it as a strategic business tool and aligning their PR campaign with their business objectives and taking a much more integrated approach to their marketing and communications strategy. Brokers need to think about what they want the PR to achieve for them and to set objectives. It is about raising awareness and adding value to their brand. It is about understanding how those objectives are going to be met and then they can actually measure the effectiveness of the campaign."

Measuring the effectiveness of PR has long been a troublesome business.

Like the bills for training and competency, there is rarely a clearly defined return on investment that can be quantified categorically. Brand, image, reputation and profile are ethereal qualities and, while few would deny their importance to the success of a brokerage, few would claim to have a formula for working out their bottom-line value on an ongoing basis or when a firm is put up for sale.

In terms of paying for PR, this is normally done on a basis of the column inches of coverage generated or by the number of hours worked on a campaign.

Staunton says: "Some people will pay by column inches, others will guarantee levels of activity and others will say they will work on a retained basis and you will receive a certain amount of their time. I think it works best where there is a strategic relationship with the consultant so they become part of the team and then it is down to them how best to go about constructing, costing and measuring a campaign."

Highlighting what she believes to be the cost-effectiveness of PR, Staunton further explains: "The traditional way that provides a bit of comfort in terms of the spend is to measure column inches and then look at what the equivalent spend would have been to buy that space. But, then you have to remember that the PR is far more powerful because it is not paid-for space." Editorial space has a value three times that of equivalent advertising space.

A leap of faith

However, for many, entering the world of PR is still a leap of faith.

Patrick Smith, chief executive of Swinton, says: "I have used PR intermittently over a number of years and I blow hot and cold on it. When I think it would be good to get the name out there and so have a go with PR, I then look at the results and cannot tell if they have enhanced my business in any way and so I am on the fence."

Where Smith feels a PR firm really earns its money is on the generation of ideas, and the knowledge of how to create interest within the press for a particular issue. He says: "When it comes to the larger organisations and getting in the national press, then I think it is all about having the route in and the ideas that will strike a chord. Last year, we performed an exercise looking into the excessive costs being charged by emergency tradesmen. We did this as it supported the launch of a product, but the idea the agency hit on was that the excess cost, paid over and above reasonable bills, was £1bn. Therefore, it was a £1bn rip-off and not only did we need the story but the hook as well and that is where the benefit of using the agency came in."

But is it best to use an agency or operate an in-house PR team? Smith says he prefers to use an agency. He says: "When I do use PR, I always look outside of the organisation and that is because if you are going to do PR and get your name across then you have to be inventive and I do not think that an organisation - even one of our size - can afford to or even should be employing highly inventive people in that way. They will be coming up with 10 ideas a day and we might be using two ideas a year. It is better that they work in agencies so we can better use their ideas and inventiveness."

Clarke says the use of an in-house team creates a point of contact for those calling into Aon, and that it allows the team to work more closely and be more aware of what is happening within the firm. However, he adds: "An agency gets an objective view of what is going on and will not be prejudiced by any company views. They can see the bigger picture and I think that is where an agency can offer an advantage. We use a mixture of in-house and agency PR, and we have an in-house team that conducts our contacts with the media. We work with an agency to help us develop our PR programme and so have the in-house relationships and the objectivity that an agency can provide in terms of news ideas and a fresh objective."

Jervois comments: "The main benefit of using an in-house communications team should be through a clear understanding of a company's business objectives and strategy and how this is implemented. Therefore, the means and ability to communicate effectively and quickly to all stakeholder groups using the most appropriate channel."

He adds: "Consultancies can offer specialist expertise of markets, audiences and/or communications streams. In many cases, the in-house team may want to use an external consultancy for a third-party opinion on a specific topic or issue. Small dedicated teams have the advantage of being able to undertake deep insight and intelligence into business and communications issues relating to specific activity, and in a position to suggest new ways and means of communicating with any stakeholder."

For those serious about brand, image, reputation and profile, PR clearly offers a route to develop and detail a broker's requirements. What is imperative is the acceptance of PR as an integral part of the business if it is going to be used. For it to work, it must be co-ordinated, focused and integrated with other aspects of the business. By pinning down the desired goals in this way, it may not become possible to quantify exact return on investment, but it will be possible to measure results and so help determine how successful it has been in driving your business forward.